George Prout

In recent years, marketing practitioners have been making great strides in understanding how the brain receives, stores, and reacts to advertising messages. I’m fascinated by this field of inquiry, because it opens potential new windows into how best to construct advertising strategies. The background information is a little too involved to address in a brief article, but I think you might enjoy a look at a recent study of how the brain works in this context.

In the May issue, I addressed the impending explosion of QR Code usage in B to C communications, facilitating an application called Mobile Tagging that will allow retailers to instantly transport a smart phone to an Internet address. QR Codes are starting to show up everywhere, from magazine covers to merchandise displays in the big box stores, and I predicted in that article that your Chain Store Competition would be using QR Codes this Fall to communicate with consumers about their product offerings.

Well, it looks like this new marketing methodology is being embraced by the Majors even more quickly than I imagined! In late April (just after the deadline for my article), Zales launched their Mother’s Day flyer, which contained ten QR Codes. And their sister company, Gordon’s, launched a Mother’s Day flyer that contained nine QR Codes. Their stores were also loaded with QR codes on every poster. In short, the new war has now begun. In order to prepare for battle, let’s take a look at some of the practical applications of Mobile Tagging in the retail jewelry store shopping environment, so you’ll be able to start making the right moves right away to keep up with the bad guys.

As I speak with retailers about using Mobile Tagging, it’s clear that they are initially thinking in terms of the “Let’s use the Internet to drive consumers to our store” model, so by reflex they ask me how to use the new technology to accomplish that objective. And yes, there are some very interesting potential applications for QR Code usage to ramp up the effectiveness of traditional advertising. In fact, you can count on me to be using it in every print piece we design for our customers this Fall. But far and away the most powerful application will occur after the consumer has entered your store.

It’s impossible at this early stage to anticipate all of the potential ways that Mobile Tagging will be used, but I think it’s useful to consider this new technology in the context of the standard retail selling dynamic. Most sales trainers teach that the selling process involves a series of steps that can be summarized as follows:

Meet & Greet

Discover

Present

Handle Objections

Close

So how would we use QR Codes and Mobile Tagging functionality in the selling process to facilitate accomplishing these steps?

For “Meet and Greet”, we definitely want QR Codes to be visible in store signage at the store entry point. In fact, we might even want to use them on the outside windows, using one way fabric that allows you to see out, but provides an opportunity for onlookers to see your message. Why would you do this? Because, no matter how high your sales volume, the vast majority of people in your market have probably never physically been inside your store, and if you’re similar to most independent retailers, the younger the audience, the lower your market share. Many entry level (or, if you prefer, pre-bridal) consumers have a built-in “Cool-o-meter” that they use to evaluate stores. Right now, the presence of a QR code will register extremely high on this scale. Even better, you’ll be able to point the QR Code to something - a product, brand, or event - that communicates your message to the consumer just as they’re stepping into your store.

At the level of “Discover” and “Present” you can aim a QR Code at specific products in the store, perhaps in concert with print or other marketing support materials that describe or define a product segment. Zales and Gordon’s did a fairly effective job of this in their Mother’s Day flyers. Be sure to start asking your vendors for specific mobile applications that tie to their products through QR Codes. They owe you help in this regard, as I’m sure you agree that the days of vendors just selling retailers ‘stuff’ are pretty much over. Your vendors have an obligation to provide you with the tools that are necessary to ensure that their ‘stuff’ sells. If you’re not getting support at this level, maybe it’s time to re-evaluate the relationship.

So far, so good, but the most profound potential impact of QR Codes may be in the area of handling objections. I’ll assume that you have a good flow of male gift-givers in your store. Sometimes they buy; sometimes they don’t. So let me ask you a question: when they don’t buy, what do you guess is the number one reason? I don’t have data for this, but I’ll speculate that when he doesn’t buy, it’s often because he doesn’t know if she’ll like the item he’s considering. The huge value of a Mobile Tagging in-store app in handling objections is that it will allow the male gift giver -who’s not sure if his intended recipient will like the item he’s selected- to instantly send an image of that item to his girlfriend’s closest friends, via texting or e-mail, so they’ll be able to confirm for him that it’s the right thing to buy.

In order to take advantage of this ultimate objection-killer, you’re going to have to add an in-store wireless router that’s not password protected, so that anyone in your store can access the Internet quickly and easily. You’ll also benefit by having several tablets (such as an iPad or Samsung Galaxy) available for your staff, because remember, a tablet is just an oversized mobile phone. (Nowadays, I can typically identify the sales associates in a store by seeing who’s holding keys, but in the very near future, it will be even easier. All I’ll have to do is look for the folks holding tablets. )

I expect you to experience a tremendous amount of interaction between your sales staff and your customers that will be based on tablet usage, because today’s younger consumers (again, that all important pre-bridal purchase group that you’re desperately needing to communicate with in order to grow your engagement ring business) belong to a generation that’s always in touch with their peers. Between Facebook and texting, there’s this amazing set of digital bonds that connect them to their friends. This extraordinary capacity to squelch this major gift-giving objection is potentially incredibly powerful. In the virtual blink of an eye, we’ll see a split in jewelry store types. There will be the fat and happy ones, with store employees who use tablets in the meet, greet, discover, present, and closing phases of the sale. And then there will be the very hungry - perhaps starving? - stores, where the owners and the sales associates wonder where all the customers went.

Shakespeare’s Julius Caesar said “Unleash the Dogs of War!” Folks, in your battle for market share with the Majors, the ‘Dogs of War’ are mobile apps tied to QR codes. The time to unleash them is at hand.

Class dismissed!

George Prout is Vice President of Sales and Marketing at Gems One Corporation. He can be reached via e-mail at This email address is being protected from spambots. You need JavaScript enabled to view it., or by calling Gems One at 800-436-7787.

Scarcely a day goes by without at least one retailer asking my opinion on if, and when, the bead frenzy will end. It’s an important question, given the extraordinary dependence that many better independent stores now have on bead lines for traffic and cash flow. As part of the diagnostic process of evaluating our customers’ marketing strategies, it’s generally helpful for me to understand the relative contribution of each merchandise category to a store’s overall revenue stream, and recently it’s not been uncommon for me to see 30 percent or more of gross revenues coming from beads. In order to understand what’s happening in this category, and perhaps gain some insight into what may likely happen in the future, let’s take a look at a fundamental marketing principle called the Product Life Cycle.

Occasionally, technological changes occur that transform society in extraordinary ways. I’m sure you would agree that the development of the personal computer represents just such a change. In this context, there have also been a series of “mini-revolutions” in which smaller incremental technological advances (e.g., the Internet, Cable TV) created transformational changes as well. In my view, we are on the threshold of a very big change, a societal embrace of a new technology that will fundamentally alter the way that retailers communicate with consumers.

There is a revolution taking place right now in the way that retail businesses communicate with their customers. This revolution is so extraordinary, and so unprecedented, that most of us are still just beginning to understand its implications. In order fully to understand what’s happening, here’s a bit of background.